REK Crosses Critical Technical Indicator

In trading on Tuesday, shares of the Proshares Short Real Estate ETF (REK) entered into oversold territory, changing hands as low as $26.29 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.

In the case of Proshares Short Real Estate, the RSI reading has hit 30.0 — by comparison, the RSI reading for the S&P 500 is currently 73.1.

A bullish investor could look at REK's 30.0 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.

Looking at a chart of one year performance (below), REK's low point in its 52 week range is $26.13 per share, with $32.45 as the 52 week high point — that compares with a last trade of $26.35. Proshares Short Real Estate shares are currently trading off about 0.5% on the day.

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